US Labour Market Loses Steam As Job Openings, Resignations Decline

• U.S. job openings dropped to the lowest level in nearly 2-1/2 years in July as the labour market gradually slowed, bolstering expectations that the Federal Reserve will keep interest rates unchanged next month.
• The Job Openings and Labour Turnover Survey, or JOLTS report, from the Labour Department on Tuesday also showed the number of people quitting their jobs dropped to levels last seen in early 2021, indicating that Americans were becoming less confident in the labour market.
• That was reinforced by a survey from the Conference Board showing consumers' perceptions of the labour market cooled in August. Nevertheless, labour market conditions remain tight, with 1.51 job openings for every unemployed person in July, compared to 1.54 in June. While that was the lowest ratio since September 2021, it is well above the 1.0-1.2 range considered consistent with a jobs market that is not generating too much inflation. Layoffs are very low by historical standards.
• "Although the labour market is still tight, the degree of excess demand is declining and is coming about through companies reducing the number of vacancies rather than increasing layoffs and unemployment," said Conrad DeQuadros, senior economic advisor at Brean Capital in New York. "There is plenty here to make the case that not only is the labour market rebalancing but at this point it is doing so without pushing up unemployment." "With reports like this, the Fed can most likely keep rates unchanged in September," said Jeffrey Roach, chief economist at LPL Financial in Charlotte, North Carolina.

(Source: Reuters)